Unemployment rate steady at 4.1%
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The news: The unemployment rate held steady at 4.1% in May, in line with expectations. However, economists had tipped the creation of about 22,500 jobs, yet employment instead fell by 2,500 people.
The jobless rate has bounced between 3.9% and 4.1% since August 2024. In April, it was also a steady result at 4.1%.
The numbers: Hours worked rose 1.3% after softer readings in March and April, when Easter and severe weather weighed on activity.
Underemployment dropped 0.1 percentage points to 5.9%.
The employment-to-population ratio slipped 0.1 percentage points to 64.2%, and the participation rate eased 0.1 points to 67%.
The context: The labour force data has been surprisingly resilient during the latest interest rate cycle and has been a major source of focus for the Reserve Bank and economists.
It is unusual for higher interest rates not to drive a spike in unemployment, so both the government and the RBA view the steadiness in the jobs market as a success, especially when compared with global peers
What they said: "Despite employment falling by 2000 people this month, it’s up 2.3% compared to May 2024, which is stronger than the pre-pandemic, 10-year average annual growth of 1.7%," said ABS head of labour statistics Sean Crick.
"This fall in employment, combined with a drop in unemployment of 3000 people, meant that the unemployment rate remained steady at 4.1% for May," Crick said.
"In trend terms, the employment-to-population ratio remained at 64.3% in May, while the participation rate stayed at 67%. Both measures have remained the same since the start of 2025."
The source: Australian Bureau of Statistics media release
